According to the U.S. Department of the Treasury, as of the end of March 2023,United States**The total amount of bonds is expected to reach 31$4 trillion. Of these, about 70%.U.S. TreasuriesIt is held by domestic investors in the United States, while the remaining 30% is held by foreign investors. Investors in the U.S. mainly include:Federal**, Federal Reserve Board, CommerceBanks, retirement**, insurance companies, individuals, and other institutions. Foreign investors, on the other hand, are mainly foreign**InternationalOrganization, Foreign**BanksandSovereign wealth**, abroadFinanceComposition of institutions and individuals.
In recent years,U.S. TreasuriesThere have been some changes in the holders. Overseas investors and the Federal Reserve began gradually**U.S. Treasuries, while in the U.S., investors are graduallyOverweightU.S. Treasuries。This change has sparked concern aboutU.S. TreasuriesFears that a crisis could erupt.
However, it should be noted that despite the fact that overseas investors**U.S. TreasuriesThe trend is obvious, but currentlyU.S. TreasuriesIt remains one of the world's leading safe-haven assets. U.S. TreasuriesThe sheer size and wide acceptance of the market have made it possible:United States**Ability to raise funds with relative stability and access to low interest rates in the global market. So, for nowU.S. TreasuriesThe crisis has not yet shown clear signs, but that doesn't mean we can ignore its potential risks.
U.S. TreasuriesThe crisis is mainly reflected in two aspects: First, there are two aspectsUnited States**May not be able to repay on time when dueDebtwithInterest, which gives rise to the risk of default;The second isU.S. TreasuriesThe crisis could be for the United States and globallyEconomyMake a huge impact.
Regarding the first aspect,U.S. TreasuriesThe risk of default is unique to the United StatesDemocracywithBudgetDecision-making mechanisms. According toU.S. Constitution** must obtain congressional approval to borrow, which includes determinationDebtof terms, interest rates, and specific usages. However, every time a loan is needed, it has to be approved by Congress, which increases the burden on Congress and limits the flexibility of fundraising. In order to solve this problem, Congress began to relax the rules for the issuance of bonds in 1917, and in 1939 the approval system was completely abolished and replaced by the adoption of the systemDebtCap to control** borrowing behavior. However, once reachedDebtceiling, and the new oneBudgetIf the appropriation plan is not approved by Congress, it will face insolvencyDebtwithInterestand thus triggering a default crisis.
WhenU.S. TreasuriesWhen a crisis erupts, its impact will be not limited to the country, but will be global as wellEconomySignificant adverse effects. First of all, the shutdown will lead to inconvenience in the lives of people in the country. For example, the shutdown of some important public services, such as buying a house, applying for a passport, etcGun licenseetc., will be affected. Public hospitals may no longer accept new patients, and livelihood projects such as garbage disposal will also face difficulties. Secondly, the United StatesEconomyIt will also be affected to some extent. The closure of national parks, the closure of national museums, and the impact on tourism-related industries have led to heavy losses in tourism and related industries. At the same time, lower spending, less consumer spending by corporate employees, and consumer and investor confidence are undermined, and may even lead toBanksBankruptcy and thirdly, such a crisis would damage the credibility of the United States, which could lead to the United StatesTreasury bondsThe bonds were downgraded, further leading to the depreciation of the dollar and weakening the United States in the worldThe right to speak
Globally,U.S. TreasuriesThe outbreak of a crisis could trigger a series of ...FinanceDisaster. First of all, a large number of themU.S. Treasuriesmay be sold off, resulting inU.S. TreasuriesThe market and the interest rate. Second, the interests of creditors will be seriously harmed, which could trigger a fightFinancial turmoil。At the same time, the depreciation of the US dollar will cause the global monetary system to fluctuate violently and emergeEconomyThe body will be hit with a huge impact. BanksMay be at risk of bankruptcy, **may**, globalEconomywill enter a state of recession. Such a crisis will give the whole worldEconomyThe shock is huge, and it could be more severe than the one that erupted in 2008FinanceCrisis.
AlthoughU.S. TreasuriesThe crisis poses serious challenges, but it is not insoluble. In order to avoid the occurrence of this crisis, it is not only necessaryUnited States**and the joint efforts of the Congress, still neededInternationalCooperation and support from the community. Here are some solutionsU.S. TreasuriesScenarios and recommendations for the crisis:
1.ImproveDebtUpper Limit:United States**And Congress should reach an agreement as soon as possible to raiseDebtcap to avoid the risk of default.
2.Formulate reasonable financesBudgetUnited States**Reasonable finances should be formulatedBudget, control the ** expenditure, reduceFiscal deficits, loweredDebtBurden.
3.ReformsDemocracywithBudgetDecision-making mechanisms: The United States should adapt its uniquenessDemocracywithBudgetDecision-making mechanism, avoidDebtThe ceiling issue has become a tool for political games, affecting the normal operation of the ** andInternationalCredibility.
4.Establish a flexible and efficient borrowing mechanism: The United States can follow the practices of other countries to establish a more flexible and efficient borrowing mechanism to reduce unnecessary disputes and risks.
5.AdjustmentsDebtEconomyModel: The U.S. should increase its foreign investment and exports and reduce its foreign exportsDebtand imports, to increase domestic production and savings, promoteEconomyOptimization and balance of the structure.
6.RespectInternationalCurrency andFinanceOrder: The United States should abandon the practice of indiscriminate issuance of money and borrowing that is overly dependent on the hegemony of the dollar, respectInternationalCurrency andFinanceOrder, maintaining the worldEconomystability and development.
Although solvedU.S. TreasuriesCrises require wisdom and courage, but only through joint efforts and cooperation can we meet challenges and create a better future. We hope that the United States will recognizeDebtThe severity and urgency of the crisis, take effective measures to solve itDebtproblems, restoration of credibility, maintenanceEconomyand social stability. At the same time, we also appealInternationalThe society should strengthen cooperation and respond togetherDebtThe risk of crisis drives the worldEconomyrecovery and growth.